Advice 4 Life

February 16th, 2021 | | Advice4Life

As we look back at 2020, it was a year we would mostly like to forget. A global pandemic, an economic shutdown, an emotional and contentious election.

But as we have done so many times in the past, as Jim Bowen, CEO of First Trust says, “We worked the problem.”

  • Medical professionals continue to work overtime, caring for the sick, compiling scientific data, and developing vaccines in historic time. 
  • Companies innovated and created ways that we could work and communicate from a distance.  Who would have thought that Zoom, would be worth more than ExxonMobil?
  • Parents balanced the need to be teacher, parent, and provider.
  • Families lost loved ones, at times without being able to say goodbye.

But it is this spirit in America that keeps us going and “Working the Problem” that makes us unique. I recall the recent Super Bowl ad about making lemonade out of lemons. 

This is what we have been doing at AEGIS Financial dating back to 1986. No matter what the market gives us, it is our job to manage through these times and look for opportunities to make life better for our clients.

As many of you are aware and have experienced, one thing that makes AEGIS Financial different is our tax planning strategies. At the end of every year, we go through all after-tax accounts we manage and determine if we should realize any losses in the account. But you may not have known that we can also realize gains if the situation is appropriate and prudent.

The small business side of our economy has taken some of the worst hits due to the pandemic. Many had to close for extended periods of time, and some have had to shut their doors. We saw the financial loss that occurred as an opportunity to offset built up gains realized over the last few years for those small businesses with which we have a relationship.  

We worked with our clients’ CPA to determine the extent of the anticipated loss, what would flow through their tax return, and sold assets in an amount to offset that loss netting a $0 tax. Another technique we used to accomplish this offset is converting IRA accounts to ROTH IRAs.

With change in the political party in power it is not difficult to see that Tax Planning will need to take on an even greater role in overall management of your financial life. We are happy to say that AEGIS Financial is well suited to take on this challenge. 

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